Software giant MicroStrategy continues to suffer thanks to its ongoing ties to bitcoin. The world’s number one digital currency by market capitalization has been seeing a series of big losses in recent weeks that have finally seen all of its 2021 gains disappear over the course of a few months, and now it looks like companies like MicroStrategy are starting to bite the bullet.
MicroStrategy lost a lot of money
A recent Form 10-Q issued by the software company’s CEO, Michael Saylor, details that the company’s first quarter was particularly bad, with MicroStrategy losing more than $170 million and more than 60% of its operating expenses due to the great cryptocurrency crash. happening lately, and that was before Bitcoin dipped below $30k. The document says:
We generated a net loss for the three months ended March 31, 2022 primarily due to impairment losses on digital assets, and we may not be able to recover or increase quarterly or annual returns in the future. Our digital asset impairment losses contributed significantly to our operating expenses and net loss. For the three months ended March 31, 2022, digital asset impairment losses of $170.1 million represented 64.5% of our operating expenses, contributing to our net loss of $130.8 million for the three months ended March 31, 2022, compared to impairment losses on digital assets of $194.1 million in the three months ended March 31, 2021, representing 68.5% of our expenses and contributes to our net loss of US$110.0 million for the three months ended March 31, 2021.
Despite evidence to the contrary, some say companies like MicroStrategy are not in as dark a place as one might think. For example, Mark Palmer, CEO of BTIG, explained in a recent interview that while MicroStrategy is heavily tied to BTC, the value of the company depends less on BTC and more on its actual software offerings, which are still pretty strong.